About Nathan Myhrvold
Specialization is great and is what has allowed all of us to continually experience improved lives for generations. Specialization allows individuals to produce far beyond their individual capabilities, which leads to higher compensation for them and a higher return on their labor for the business.
However, when taken too far, specialization can become a liability.
As a contractor, tightening up means making some difficult decisions in regard to talent. You need to keep the people on your team that can keep the machine running with a lot less support. These people are the ones that have a combination of multiple capabilities and a higher capacity for work.
Contractors that focused too much on trying to optimize profitability in a stable or modestly growing environment will not have enough of these highly valuable cross-trained team members.
The same concept applies to rapid growth, where problem-solving utility players with a high capacity for getting things done is required.
The same also applies to selecting your market strategy. You don't want to be the "Jack-of-All-Trades," but you also don't want to be so committed to a customer, market sector, or geography that you create instability in your business during a downturn.
When looking at your career, the same thought applies. Stability and growth in all economic conditions depends on how versatile and capable you are.